Question
Month Actual Sales (Pairs of reading glasses) January 2021 2800 February 2021 3000 March 2021 5000 April 2021 4000 May 2021 5600 June 2021 8000
Month | Actual Sales (Pairs of reading glasses) |
January 2021 | 2800 |
February 2021 | 3000 |
March 2021 | 5000 |
April 2021 | 4000 |
May 2021 | 5600 |
June 2021 | 8000 |
July 2021 | 8000 |
August 2021 | 7900 |
September 2021 | 6000 |
October | 4050 |
November 2021 | 4900 |
December 2021 | 5550 |
Using the sales data of the reading glasses answer the following questions:
4.1 Calculate the three-month-weighted-moving-average monthly forecasts for the period April 2021 - December 2021. Use weights of 0.5, and 0.2 for the most recent and oldest monthly data respectively and 0.3 for the middle month (show all workings).
4.2 Determine the Mean Absolute Deviation (MAD) of the three-month-weighted-moving average monthly forecasts for the April - December 2021 period. (4 marks)
a. The linear regression equation of the sales of reading glasses for the 2021 financial year is given by the expression: y = 201.4x + 4091 (where 'y' denotes monthly sales, and 'x', the number representing the month. For example, x = 1, 2, 3, etc., if the month is January, February, March, etc.). Use the regression equation to determine the Mean Absolute Deviation (MAD) of the regression forecasts for the April - December 2021 period. (5 marks)
b. Which of the two methods is better at forecasting the sales of the reading classes? Explain. (2 marks)
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started